Measuring the Process Innovation of China's High-Tech Manufacturing

The study on process innovation has gained momentum in recent years. As to China, there are many special characteristics in technological nature and market condition. In the early stage of development, China's manufacturing industries introduce mature technology directly and launch competition in the late stage of product life cycle. Consequently, process innovation has become strategic priority. Data Envelopment Analysis(DEA) is used in this paper to measure the Malmquist productivity of process innovation and analyse the influencing factors of TFP in China's high-tech industry from 2000 to 2008. Result shows that, there are great fluctuations of total factor Productivity in overall Hi-tech industry; efficiency of process innovation in China's high-tech industry mainly relies on technological progress rather than efficiency of resource allocation; Malmquist index of process innovation varies in different industries. The efficiency of process innovation in Medical Equipments and Measuring Instrument is relatively high, while the lowest efficiency is Medicines industry. The article also made recommendations on the improvement of non-effective unit.